Research by Jim Prutow, a partner at management-consulting firm PRTM, highlights nine transactions by publicly traded pharma and related companies over the past decade that included CVRs. (Biotechs were considered separately.)

Prutow says that it’s too soon to tell if CVRs were a good way to go for the purchaser or acquiree.

Correction: The list of transactions has been corrected from the original post to include two transactions — Life Technologies/Ion Torrent and AstraZeneca/Novexel — and remove two others — Celgene/Abraxis and OSI/Cell Pathways.

Comments (5 of 6)

Can you please tell me of the nine CVR deals mentioned in your article, how many of those had a Pay out ?

Thank you

9:33 pm February 21, 2011

Anonymous wrote :

Katherine, and updates?

Editor Comment

2:08 pm February 14, 2011

Katherine Hobson wrote :

Chris: This analysis was limited; I'll find out the parameters and update.

1:52 pm February 14, 2011

Chris Morrison wrote :

unless you're intentionally limiting this tally to publicly traded targets (not sure why that'd be the case) you're missing the majority of CVR/earn-out deals. In 2010 alone there were at least 19 acquisitions of private biotechs that were enabled by a CVR component. and that's out of about 25 deals (i say at least 19 because terms aren't always disclosed). CVRs in biotech acquisitions have been the rule, not the exception, for a few years now. even going back to 2005, CVRs featured in about 35% of private biotech acquisitions. Here's a story that includes a chart that tracks back to 2005: